As the financial industry continues to demand more self-service options to conduct business with the Florida Office of Financial Regulation and the public continues to demand aggressive, timely regulatory efforts to protect its interests, our Office faced pressures to streamline and improve the efficiency of our licensing and regulatory processes. Moreover, like many state agencies, we are challenged to do more with less. 

To respond to these demands, we undertook a significant legislative, organizational, and technical restructuring that transformed the agency. The technical restructuring focused on replacing more than 20 legacy systems with a single comprehensive financial regulatory management system that would improve the efficiency of our fiscal, licensing, examination, complaint intake, financial investigations and legal processes. Making the transition to a single system also presented the opportunity to combine and automate several of our core processes that required significant manual effort. A new technical solution could also offer a Web portal to promote self-service for the public and license holders. 

The Office worked closely with Accenture to design, build, and implement the new system, called Regulatory Enforcement and Licensing (REAL). This effort included designing, building, and configuring a new technical and application infrastructure using new computer hardware and the latest versions of core software components. To create a high-quality solution that used an optimal combination of components to meet our requirements effectively and cost-efficiently, the solution was designed using commercial-off-the-shelf (COTS) packages and new custom development. Web components were used to integrate the solution with back-office operations. 

The design of a new system afforded OFR the opportunity to incorporate staff ideas and develop robust capabilities, including a master license/registration application and enhanced capabilities for online application and payment. OFR and Accenture project teams also designed and developed a data repository that supports data mining and a document imaging and document management system. The final system provides our staff with new tools, upgraded technology, expanded access to data sources, and improved visibility to a specific licensee's history with the Office via the consolidation of licensing and enforcement information in one system.

The REAL implementation was delivered over two releases over 21 monthsand completed on time and under budget. With REAL, OFR met our goals of streamlining business processes for maximum efficiency, improving customer service, and implementing new technological capabilities. These achievements enable us to provide better, faster, and more convenient service to citizens. 

REAL has dramatically improved renewal processing time and provided other benefits: 
	The average processing time for mortgage industry renewals declined from more than 12 days at the project outset to currently less than an hour. 
	Under the new system, 100 percent of initial applications from the mortgage industry and all mortgage industry renewals are received online. 
	In the first year of production, bad checks were reduced by approximately 80 percent due to new payment options.
	Approximately $15,000 in postage costs were avoided over the first year due to new self-service options as well as operational changes.

In addition, with REAL OFR is now able to:
	Strengthen the Office's capability to assess license applicants and monitor regulatory compliance of financial institutions more closely.
	Meet customers' demands for real-time access to information, 24 hours a day, seven days a week.
	Reduce the processing time for customers.
	Reallocate resources from processing paper to direct client service and citizen-protection activities.

The Regulatory Enforcement and Licensing (REAL) project's primary focus was to equip the Office of Financial Regulation to meet the demands of its licensees and consumers for more self-service functions, more efficient and greater transparency of regulatory processes, and access to more timely information. The Office had started the REAL journey by focusing efforts on legislative reform to break down barriers with regard to electronic document submission, mandating the use of e-services for core business functions, and establishing a legal interpretation with regard to public records law information. 

As that chapter was ending, the Office needed to begin the effort to upgrade and expand our technology to support these new legislative changes and to meet the expectations of our customers/licensees. We had completed a feasibility study to help us identify our requirements, both functional and technical. Based on a review of these requirements and the timeline we were targeting to achieve outcomes, the decision was made to pursue a COTS software package as the cornerstone of the technical solution.

The selection of the Versa Regulation: Licensing & Regulatory COTS solution was an important one for the success of the project as it provided the foundation for all other aspects of the project. We desired a software solution that was largely configurable and flexible enough to support our often complex business processes. The Versa Regulation product provided the niche software to meet our licensing and regulatory process needs, while still providing us the ability to have much of the system controlled by code/configuration tables. This last point was particularly important as we wanted to put more control within the hands of our business experts. 

Another contribution that the Versa Regulation software provided, which was critical to the project success, was an inventory of Web services that allowed our system integrator (Accenture) to build a custom portal that essentially extended the back office. The custom .NET portal used the Web services to complete business functions, such as filing an application, uploading a document, paying a license renewal real-time, checking on the status of licensee, filing a complaint, and alerting an OFR employee that new information was submitted via the portal. The integration between the custom REAL portal and the COTS Web services directly led to the expansion of self-service without putting undo burden on the OFR staff themselves.

In addition to the COTS regulatory software, it was important to our business units to have a comprehensive solution for document management. We needed a solution that would (1) allow for us to truly enable workflow via document review/refinement across our various business units, (2) allow us to collect application, compliance, licensing, and complaint documents from our licensees and the general public via the REAL portal, and (3) support and automate our complex records retention rules. As an industry leader, FileNet was selected to fulfill this critical component of our vision.

Yes

Yes

The REAL project has had positive impacts on our public consumers, licensees regulated by OFR, as well as our internal OFR personnel.

Public Consumer

Through the establishment of the REAL portal, consumers wanting to do business with a person or business licensed by OFR have now been provided with real-time information regarding whether the individual/business is in good standing and the types of business activities they are authorized to conduct. The project also provides consumers with the ability to file a complaint (including uploading of supporting documentation) and to monitor the progress of their complaint. These consumer-centric functions help OFR in our mission to protect the citizens of Florida from financial fraud by providing consumers with key information about with whom they are doing business as well as a more efficient way to collect consumer concerns about one of our license holders.

Licensee

The licensees have many new opportunities to interact more efficiently with OFR as a result of the project: (1) All Finance initial applications can be filed and paid for via the REAL portal; (2) Applicants have the ability to provide supporting documentations real-time through the REAL portal's document upload feature, which reduces overall processing time for applications; (3) All Finance license renewals can be completed real-time via the REAL portal; (4) Licensees now have a free, self-service feature to print proof of licensure from their home computers; and (5) Licensees now have greater transparency into the licensing processes of our agency as the status of applications, license amendments, and the like are available real-time to our licensees.

OFR Personnel

As with most regulatory agencies, we have several business areas that are critical to performing our licensing and regulatory functions: Regulatory Review, Enforcement, Investigations, and Legal. Prior to the REAL project, our staff had in excess of 20 different databases and payment, applicant/licensing, and enforcement information was all in separate systems. This division made it very cumbersome and time consuming for our personnel to process an application, complete an enforcement examination, or investigate unlicensed activity. Also, by having separate systems, many of the registration records were duplicated making it harder to track an individual or businesses licensing and compliance history.

The biggest advantage we have given our staff is the consolidation of data into a single, integrated data repository. This repository now allows us to complete registration record consolidation, see a comprehensive view of an entityapplications, licenses, enforcement cases, investigations, view data trends more succinctly, and provide real-time information to our licensees and the public.  

This single data repository has also given us the opportunity to use the workflow function within the COTS software. This function helps marshal work within and amongst the different business units as well as provide timely alerts to critical processing time frames established in our own performance metrics or Florida statute. These capabilities help us license more efficiently and regulate more fairly as we have a comprehensive view of the data to make decisions.

The REAL system has provided many benefits to our licensees as well as our OFR personnel by establishing an enhanced Web presence, integrating document imaging, expanding the data collected and tools to evaluate it as well as automating many manual processes.

Benefits to Our Licensees

"REAL has provided licensees with a one-stop shop' to deal with all of their regulatory filing issues, enabling them to submit new applications, see the current status of all of their regulatory filings, and renew their license at their convenience. This has allowed our staff to focus efforts on improving efficiency in the licensing processes as cumbersome, paper-based processes have been streamlined by leveraging the new self-service functions and the automated workflow within the REAL system."  Terry Straub, Director of the Florida Office of Financial Regulation Division of Finance

Benefits to OFR 

"As a regulator, it is crucial that you see the big picture.' REAL has provided this ability by transforming the existing set of patchwork systems and inefficient processes into a single database to support key business processes. We can now see, through the entity comprehensive view, all key regulatory data for a given entity. We can use this data to drive the regulatory program and best utilize the Office's limited resources. For example, this data can be used in the Office's risk-based examination program to identify those firms or individuals that pose the greatest risk of financial harm to Florida's consumers."  Rick White, Former Director of the Florida Office of Financial Regulation Division of Securities

We believe that there are several unique and exceptional aspects of the REAL project.

Successful Mix of COTS and Custom

From our original feasibility study, OFR established more than 900 business and technical requirements for the REAL project. Our goal was to establish a technical solution that had a commercial-off-the-shelf (COTS) regulatory software package at the core for ease of maintenance, stability, and upgrade potential. However, we also had specific requirements around the document imaging solution, ad hoc reporting needs, and the functions that needed to be supported on the custom portal.

We believe the exceptional aspect was that the final solution integrated three disparate COTS software packages (Versa Regulation: Licensing and Enforcement; FileNet P8; Microsoft Reporting Services) with a custom-built .NET portal. While the technical integration was challenging for our system integrator (Accenture), we believe the truly exceptional aspect is that for most of our core business processes the transition between these components is seamless for the business user.

Empowering Legislative Reform

One of the goals of the REAL project was to provide more self-service functions to both our licensees and the public. To enable this vision, a significant amount of legislative reform was completed to redefine Florida statute/rule to dismantle the barriers for electronic submission of applications, mandate the use of the REAL portal for specific business functions (e.g., events), and expand the information to be collected and used for more insightful OFR reviews.

The exceptional aspect was that this legislative reform was often concurrent with the design of the REAL project solution. As such, the project management team, business stakeholders, and the actual technical solution had to be flexible as the legislation was finalized. However, it all came together as the effective date of the legislation coincided with the go-live date of the REAL project.

On Time /On Budget

Based on the feedback from our Florida legislative technology review group and our discussions with other regulatory agencies, we believe an exceptional aspect for the REAL project was that it was completed on time and within budget.

When we started the REAL project, we knew there would be challenges given that significant change was occurring through the technology upgrades and process reengineering. The two most important obstacles to overcome early in the project because of their impact to the organization and the project schedule were the efficient/effective utilization of our OFR resources and the acceptance of the commercial-off-the-shelf (COTS) solution.

Project Resources

As part of the project initiation, we had identified a core group of personnel who were to be dedicated to the project from each of our core business areas. The individuals identified were personnel who were fairly new to the OFR organization. Our intention was that through the course of the project these individuals would gain the knowledge capital on both the system and the revised processes to carry the effort going forward. This intent was indeed the case; however, there were still key decisions and business acumen that required involvement from our upper management and directors.

While our project was fortunate to have these senior members who wanted to be so actively involved, the project faced the challenge of trying to involve these key stakeholders and keeping pace with the schedule that the project demanded. Schedule conflicts and numerous competing deadlines necessitated a new approach.

Our solution was to establish "participation teams." For each facet of the projectcommunication events, portal design, report design, COTS system configuration, technology efforts, training planning and delivery, user acceptance testing planningwe established a team led by a member from the OFR management team as well as a member from our system integrator, Accenture. The team leads had joint responsibility for task delivery, issue resolution/escalation, deliverable review, and status reporting to the project manager.

This team structure allowed our key stakeholders to focus efforts in a particular area of the REAL project, while allowing them to complete their day-to-day responsibilities for the Office.

Acceptance of a COTS Solution

As stated, we had more than 20 legacy databases which, for the most part, were designed with and for many of the key stakeholders involved in the REAL project. While the decision to pursue a COTS regulatory software was unanimous, there were challenges when it came to the way the software supported a particular process, the extent to which it could be customized for a particular business area, and even the type of terminology used within the software package itself.

As part of the project, we established a participation team to focus on organizational change.  This team worked closely with the users and management in each business area to review the core processes and define how the process would be completed within the new system. These teams completed "quick reference" guides, which were job aids that helped people understand where a function was to be performed in the new system and other helpful hints.

Another way we helped people accept the COTS solution was to facilitate numerous lunch-n-learn sessions. At these sessions, the system integrator or representative from the software vendor would discuss a particular topic and how it would be completed in the new system as well as some additional advantages/functions that the users did not have in the legacy systems.

We attempted to provide our user community with multiple opportunities to see/use the system in a non-threatening environment to see the advantages of a COTS solution and how it could help them.

Several years ago we began the foundation of the project by completing an internal feasibility study. We focused on the capabilities that were needed based on our aging legacy systems and our desire to provide more self-service functions for our license holders and the public at large. The feasibility study, however, was met with some opposition from our legislative body's technology review group. The task posed to us was to complete a more formal use case and requirements analysis.

To provide the expertise and objectivity needed for this next iteration, the Office hired a third party that specialized in this area of business. In conjunction with our partner, we successfully completed more than 40 use cases for all core business processes conducted by the OFR and formalized more than 900 business and technical requirements. These outcomes provided us with the approval from the legislature to move forward with the project and were the foundation for the Invitation to Negotiate (ITN).

While this process was a diversion from our original plan and schedule, we feel that the time spent gaining consensus and formalizing our requirements served us well when we were evaluating the various COTS solutions and selecting an implementation partner as well as throughout the course of the implementation project.

Achieved

Other Regulatory Organizations

The success of the REAL project has already proven to be beneficial beyond our intended audiences. Within the state of Florida, representatives from other regulatory agencies have met with our project management team to discuss not only the approach taken for the feasibility study, the manner in which the project itself was managed, but also the overall technical solution. We have shared information (e.g., deliverable templates), completed some demonstrations, and are currently forming a user group to discuss with the other regulatory agencies their possible migration to the COTS software solution.

Global Communities

Due to recent federal legislation, we have been working closely with other states to discuss the new National Mortgage and Licensing System (NMLS). Through this exchange, we have shared aspects of the REAL project such as the legislative reform initiatives, additional information that we now require regarding disclosure of criminal activity, and how we currently complete core processes, such as fingerprint card processing.

In this broader community, our success has provided other states with a knowledge base on which to pursue their own technical integration project.

The licensee community has taken to the new system very quickly. Within hours of going live in production, applicants began filing new license request forms online and licensees were completing renewal transactions. For those finance license types supported on the REAL portal, all initial applications and license renewals are required to be completed using the new self-service functions. This shift meant nearly 40,000 transactions were automatically created in our new system and assigned, and the money (nearly $6 million) automatically collected/allocated.

The citizens of Florida also began using the new services almost immediately, with the public license search and the ability to file a complaint (complete with supporting document upload) being the primary functions used.

OFR personnel were another large user base that was impacted by the REAL project. Through the project, we have tried to integrate technology to facilitate and complete business processes that in the past were time consuming and took time away from our core mission. The most significant changes to our business processes were:

(1) The launch of self-service functions for the submission of initial applications, amendments, and renewals.
(2) Establishment of an Office-wide document management repository and associated integration with the COTS regulatory package.
(3) Expanded data collection used for decision making, risk-based targeting of routine examinations, and OFR performance monitoring.

Our personnel have embraced the new capabilities and enhanced data-capture functions to help them perform their jobs more efficiently and effectively. We have established a REAL Maintenance Team to drive refinements to the technical solution. Similarly, we have established an Operations Synchronization Team to review business processes to ensure our business units are using the REAL system consistently and to the fullest extent possible. Both of these teams have direct representation from each of our business units as well as our system integrator, Accenture.